India to Launch MNP in Haryana This Week

The long-awaited mobile number portability (MNP) system will be launched on 25 November 2010 in the Haryana circle (India), where subscribers can start switching between any of the operators without changing their phone numbers, the Times of India reports. Haryana has eight mobile operators: Airtel, Idea Cellular, BSNL, Aircel, Loop, Vodafone, Etisalat DB, and Datacom. According to figures released by the Cellular Operators' Association of India (COAI), the circle had 11.68 million subscribers by the end of October 2010. The launch will fulfill the latest deadline set by the Indian authorities for launch of the system by 25 November 2010. The plan has been confirmed by several operators, with Idea Cellular taking the lead with its “Switch to Idea” commercials debuting on TV channels.

Outlook and Implications

• Roll-Out Progress to Be Slow: There have been repeated delays to the introduction of MNP services in India, partly due to technical difficulties faced by the operators in rolling out the system. The new services will drive up competition by making it easier for operators to switch service providers. However, there is no clarity yet about what area will be next after Haryana. In discussions between the Department of Telecommunications (DoT) and operators, it was decided that all operators would have to introduce the services in one go. Even if one operator is not ready with the systems, it will create a problem for other operators. With the holiday season around the corner and many employees at telecoms companies going on annual leave, operators will want to avoid making any changes or upgrades to their systems during this time. This means the MNP system is unlikely to be rolled out in any other circles by the end of this year. The progress of expansion may also be slow next year.

• Challenges Faced by New Operators: The introduction of MNP has been partly designed to make it easier for new operators to churn the existing customers of the established operators. However, given that the speed of service expansion by new operators is extremely slow and several established operators are launching advanced 3G services, the MNP system will benefit the established operators more. The new players may even risk losing the customers they have already acquired. The development also comes at a time when several new operators have been accused of acquiring their 2G licences illegally in 2009. The DoT is also set to impose penalties on six of the new entrants—Datacom, Sistema, Uninor, Loop, S Tel, and Etisalat DB—for delayed roll-out of services. The operators, which have yet to launch mobile services, are facing the possibility of losing their licences and spectrum (see India: 18 November 2010: Controversy over 2G Allocation in India Escalates).

• MNP to Help Gain 3G Customers: The introduction of the system will help established operators gain new customers to their 3G services. A number of operators, which won 3G spectrum in the auction in May, have announced they would launch the new services by the end of this year or early next year. These include Tata DoCoMo, Bharti Airtel, Vodafone Essar, and Aircel. Tata DoCoMo is taking the lead by formally launching the system in the Maharashtra circle today. The 3G network, set up with assistance from Japan’s NTT DoCoMo, supports high-speed internet access with speeds up to 21.1 Mbps and also supports high-definition voice on calls. The company also announced new plans, such as small-screen and large-screen plans, for consumer to upgrade to 3G life.